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Petronet LNG Board decides to start MD & CEO selection process afresh

Petronet LNG Board decides to start MD & CEO selection process afresh
The selection of a new head of India’s biggest LNG importer, Petronet LNG, will start afresh after a headhunting panel failed to arrive at a consensus on candidates. The Board of Petronet LNG on Saturday met to consider appointing a new Managing Director and CEO based on recommendations of a three-member search committee, headed by ONGC Chairman Dinesh K Sarraf, a top source said.

The panel, whose constitution was questioned by at least one promoter director, failed to give a consensus candidate, leading to the Board deciding to start the process afresh, the source said. The Petronet LNG MD and CEO has always been selected by a search committee compromising of all the promoters, GAIL, IOC, BPCL, ONGC and GdF of France. But this time, a three member panel with Sarraf as head and including two independent directors of Petronet LNG was constituted.

Another top source said that the constitution of the panel by the Oil Ministry, whose Secretary is the Chairman of Petronet LNG even though the company is a private-listed company, came in for questioning as Sarraf was not the seniormost among the promoter directors. Also, inclusion of independent directors — Arun Kumar Misra and Sushil Kumar Gupta came in for questioning, the source said.

Sarraf, who took over as the Chairman and Managing Director of Oil and Natural Gas Corp (ONGC) on March 1 last year, was awaiting confirmation when he was named the head of the Search Committee last month. As per rules, all appointments to a PSU board have to be confirmed after one year.

Among the candidates who had applied for the job at the close of application on March 20 were Pramod K Bajpai, Director (Finance) of Bhel and an IIT-Kanpur batch mate of Oil Secretary Saurabh Chandra.  Besides Bajpai, the panel interviewed gas utility GAIL Director (Marketing) Prabhat Singh, Oil India CMD S K Srivastava and Engineers India (EIL) head A K Purwaha on March 30.

The source said the recommendation of the panel was opened at the Petronet Board meeting on Saturday. Sarraf was confirmed as Chairman and Managing Director of ONGC earlier this week. The others who applied for the post included GAIL Directors P K Jain and Ashutosh Karnatak, Petronet LNG Director (Finance) R K Garg and its Director (Technical) Rajender Singh, sources said.

Petronet LNG is owned by state-owned oil firms ONGC, GAIL, BPCL and IOC but is registered as a private company and its MD & Chief Executive Officer (CEO) has always been appointed by a panel of promoter firms. A new MD & CEO of Petronet LNG is being appointed after the government decided not to give an extension to incumbent A K Balyan.

Balyan’s five-year term ends on July 15. He is eligible for extension till he attains the superannuation age of 65 years in July 2016 but was not given an extension. An advertisement was issued on March 3 and applications sought by March 20. Interview call letters were sent on March 21 and interviews held on March 30. 

Oil Secretary Saurabh Chandra retires on April 30. Balyan, who turns 64 in July, was appointed Managing Director and CEO of Petronet LNG for a five-year term beginning July 16, 2010, with the condition that it could be extended till his superannuation age of 65 years. The new head, however, will assume charge from July 16.

Balyan, who was then ONGC Director (HR & Business Development), was in May 2010 selected 
for the top job at Petronet LNG by a panel consisting of the heads of the promoters of the company. 
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